MMG : CONTINUING CONNECTED TRANSACTION - SHIPPING FRAMEWORK AGREEMENT

Hong Kong Exchanges and Clearing Limited and The Stock Exchange of Hong Kong Limited take no responsibility for the contents of this announcement, make no representation as to its accuracy or completeness and expressly disclaim any liability whatsoever for any loss howsoever arising from or in reliance upon the whole or any part of the contents of this announcement.

MMG LIMITED

五礦資源有限公司

(Incorporated in Hong Kong with limited liability)

(STOCK CODE: 1208)

CONTINUING CONNECTED TRANSACTION

SHIPPING FRAMEWORK AGREEMENT

Shipping Framework Agreement

On 30 July 2020, the Company entered into the Shipping Framework Agreement with Minmetals Logistics in relation to the provision of ocean transport by Minmetals Logistics for the shipment of the products of the Group.

Minmetals Logistics is a wholly owned subsidiary of CMC, the ultimate controlling shareholder of the Company, and is therefore an associate of CMC and a connected person of the Company under the Listing Rules. As a result, the Shipping Framework Agreement constitutes a continuing connected transaction for the Company.

As all of the relevant percentage ratios in respect of the Shipping Framework Agreement are more than 0.1% but less than 5%, the transaction constitutes a continuing connected transaction which is subject to the reporting, annual review and announcement requirements, but exempt from the independent shareholders' approval requirements, under Chapter 14A of the Listing Rules.

SHIPPING FRAMEWORK AGREEMENT

As part of the ordinary and usual course of business, the Group engages ocean transport from various shipping services providers and/or brokers for the shipment of its products, including copper, zinc and lead concentrates.

On 30 July 2020, the Company entered into the Shipping Framework Agreement with Minmetals Logistics in relation to the provision of ocean transport by Minmetals Logistics for the shipment of the products of the Group from time to time during the term of the Shipping Framework Agreement.

- 1 -

The principal terms of the Shipping Framework Agreement are set out below.

Parties	:	(1) Company
		(2) Minmetals Logistics
Services to be purchased	: Provision of ocean transport for the shipment of the products of
		the Group between ports nominated by the Group pursuant to
		specific voyage charter party agreements on normal commercial
		terms to be negotiated by the parties on an arm's length basis
		from time to time
Term	:	The period from 1 August 2020 to 31 December 2022
Pricing of sea freight	: Prices will be expressed in US Dollars determined on an arm's
		length basis and consistent with the prevailing international
		market practice and rates at the time for similar services which
		shall be based on the freight rate to be paid per wet metric ton,
		such rate to be inclusive of all port charges, pilotages, light dues,
		port agents' fees and all other dues usually paid by the relevant
		vessel
		Other applicable rates will be as negotiated but will include,
		without limitation, load rates at an agreed rate of wet metric tons
		per weather workings days for the applicable port, discharge rates
		at an agreed rate of wet metric tons per weather working day with
		agreed laytime and demurrage and despatch rates at a rate of US
		Dollars per day, that are consistent with the current shipping
		market for similar services
Payment terms	: Payment will be made in accordance with the terms of each
		voyage charter party provided always that 95% of the total
		payment will be paid on bill of lading weight at least 7 days from
		signing and release of bills of lading

If the Company wishes to engage ocean transport for the shipment of its products, the Company may advise Minmetals Logistics of its vessel requirements for the particular cargo. The Company may, in addition, place its requirements into the open market through a panel of shipping brokers selected by the Company. Minmetals Logistics may submit an offer to the Company in response to those requirements and the Company will evaluate the offer having regard to current freight market conditions and, where the requirements have been placed in the open market, offers submitted by other parties.

If selected by the Company, Minmetals Logistics shall fix a vessel under a voyage charter party agreement to be negotiated by the parties on commercial arm's length terms, but which will be consistent with the terms of the Shipping Framework Agreement and will include international terms for similar voyage charter party agreements addressing (without limitation) contract/shipment period and spread, nominated vessels, freight rates, payment terms and other usual conditions (including those dealing with laytime, demurrage, loading and discharging terms).

- 2 -

The terms of the Shipping Framework Agreement were arrived at after arm's length negotiations between the Company and Minmetals Logistics.

ANNUAL CAPS

The maximum aggregate amount to be paid under the Shipping Framework Agreement for each calendar year during the term of the Shipping Framework Agreement is capped at US$23.0 million. On this basis, the Annual Cap is US$10.0 million for 2020 and US$23.0 million for 2021 and 2022. The annual cap was determined by reference to the agreed pricing principles set out in the Shipping Framework Agreement, projected production volumes and schedules of the Group, requirements of buyers including loading and discharging points and prevailing and projected international market sea freight rates for similar services from Peru and Australia.

REASONS FOR AND BENEFITS OF THE SHIPPING FRAMEWORK AGREEMENT

The Group's principal activities include the production of zinc, copper and lead concentrates, and as part of its ordinary and usual course of business the Group sells these products and requires ocean transport to deliver such products to its customers. Engaging the services of Minmetals Logistics has the benefit of making additional shipping services available to the Company, therefore allowing the Company to maximise its delivery options and to consequently both (i) meet its obligations to customers in a timely manner and (ii) manage the production schedules and ensure efficient operations of Group members.

In view of the continuing nature of the transactions which are the subject of the Shipping Framework Agreement, the Directors (including the independent non-executive Directors) believe that the entering into of the Shipping Framework Agreement has the benefit of reducing the administrative burden and costs associated with compliance with laws and regulations to which the Group is subject.

The Directors (including the independent non-executive Directors but excluding the Interested Directors) are of the view that the Shipping Framework Agreement is on normal commercial terms, and is fair and reasonable and in the interests of the shareholders of the Company as a whole.

The Interested Directors, each holding position(s) at CMC and/or CMN, have abstained from voting on the Board resolution approving the Shipping Framework Agreement in order to avoid any possible conflict of interest issue.

LISTING RULES IMPLICATIONS

Minmetals Logistics is a wholly owned subsidiary of CMC, the ultimate controlling shareholder of the Company, and is therefore an associate of CMC and a connected person of the Company under the Listing Rules. As a result, the Shipping Framework Agreement constitutes a continuing connected transaction for the Company.

Pursuant to Rule 14A.76(1) of the Listing Rules, as all of the relevant percentage ratios in respect of the Shipping Framework Agreement are more than 0.1% but less than 5%, the transaction constitutes a continuing connected transaction which is subject to the reporting, annual review and announcement requirements, but exempt from the independent shareholders' approval requirements, under Chapter 14A of the Listing Rules.

- 3 -

The Shipping Framework Agreement also includes a provision which entitles the Company to suspend or terminate the Shipping Framework Agreement or any individual voyage charter party that has been entered into by the parties should the Company be unable to satisfy any requirements of the Listing Rules.

INFORMATION ABOUT THE GROUP

The Group is engaged in the exploration, development and mining of zinc, copper, gold, silver and lead deposits around the world.

INFORMATION ABOUT MINMETALS LOGISTICS

Minmetals Logistics is a wholly owned subsidiary of CMC, the ultimate controlling shareholder of the Company. Minmetals Logistics is principally engaged in the business of providing ocean transport for dry bulk cargo, break-bulk and containers for operations such as the Group and the shipping market in general.

DEFINITIONS

In this announcement, the following expressions have the meanings set out below unless the context requires otherwise.

Board	the board of Directors
CMC	中國五礦集團有限公司 (China Minmetals Corporation), a State-
	owned enterprise incorporated under the laws of the PRC and the
	ultimate controlling shareholder of the Company
Company	MMG Limited, a company incorporated in Hong Kong, the securities
	of which are listed and traded on the main board of the Stock
	Exchange
connected person	has the meaning ascribed to it under the Listing Rules
controlling shareholder	has the meaning ascribed to it under the Listing Rules
Director(s)	the director(s) of the Company
Group	the Company and its subsidiaries from time to time
Hong Kong	the Hong Kong Special Administrative Region of the People's
	Republic of China
Interested Directors	Guo Wenqing, Zhang Shuqiang, Jiao Jian, Xu Jiqing and Gao Xiaoyu
Listing Rules	the Rules Governing the Listing of Securities on the Stock Exchange

- 4 -

Minmetals Logistics	Minmetals Logistics Group Co., Ltd, a company incorporated in the
	PRC and a wholly owned subsidiary of CMC
PRC	the People's Republic of China (for the purpose of this
	announcement, excluding Hong Kong, the Macau Special
	Administrative Region of the PRC and Taiwan)
Shipping Framework Agreement	the agreement dated 30 July 2020 between the Company and
	Minmetals Logistics described in this announcement
Stock Exchange	The Stock Exchange of Hong Kong Limited
subsidiary	has the meaning ascribed to it under the Companies Ordinance
	(Chapter 622 of the Laws of Hong Kong)
%	Percent

Unless otherwise specified, conversion of US$ into HK$ in this announcement is based on the exchange rate of US$1.00 = HK$7.80 for the purpose of illustration only. No representation is made and there is no assurance that US$ or HK$ can be purchased or sold at such rate.

By order of the Board

MMG Limited

Gao Xiaoyu

CEO and Executive Director

Hong Kong, 30 July 2020

As at the date of this announcement, the Board comprises eight directors, of which one is an executive director, namely Mr Gao Xiaoyu; four are non-executive directors, namely Mr Guo Wenqing (Chairman), Mr Jiao Jian, Mr Zhang Shuqiang and Mr Xu Jiqing; and three are independent non-executive directors, namely Dr Peter William Cassidy, Mr Leung Cheuk Yan and Mr Chan Ka Keung, Peter.

- 5 -